sets and payrolls) including the WAPDA, Sui Gas, and the Pakistan Telecommunications Corporation.
During the term of the second Bhutto regime, the government relied on a series of large, highly visible disinvestment transactions. However, since the need to improve the short-term budgetary situation was growing more acute, owing both to the restrictive covenants imposed by the International Monetary Fund and the risk of default on a growing national debt (approximately $ 70 billion by March 1997), some of the sales generated considerable controversy. For instance, the partial disinvestment of Pakistan Telecommunications Corporation in 1994-95 realized over $800 million in foreign investment, but was marred by claims that the investment banker had failed to practice due diligence. The sale of United Bank Limited was shelved following allegations of secret deals and major unannounced loan write-offs. And, the sale of the Kot Addu power plant was tainted by the claim that it had been purposely undervalued. Indeed, there was a growing suspicion that debt retirement and short-run fiscal benefits were taking precedence over the efficiency and the rejuvenation of the corporate sector as the primary objectives of privatization. Privatization appeared to have become a prisoner of the debt crisis.
The dismissal of Benazir Bhutto's government in late 1996 led to a period of relative consolidation, as the Privatization Commission made a conscious and successful attempt to improve its image and to refocus the direction of its programs. This refocusing involved an attempt to define a speed and sequence for a program which would achieve the stipulated objectives of the government. By the end of 1996, a total of 85 units in different sectors had been sold in Pakistan. The sales generated $1.4 billion for the national exchequer.
Ongoing transactions include major units in the energy sector, including the Karachi Electric Supply Corporation, and the country's two main gas generation and distribution companies. Other ongoing transactions include large manufacturing units and Habib Bank Limited. In addition, potential transactions include: Pakistan International Airlines; the Pakistan National Shipping Corporation; commercial and development banks such as National Development Finance Corporation; State Life Insurance Corporation; power plants; area electricity boards; and over thirty major industrial units.
Many of the reforms undertaken in Pakistan since 1991 fall into the broad category of liberalization focused on deregulation. The government eased restrictions, modified rules and regulations, and removed barriers to entry. In most cases, deregulation has preceded privatization. As was mentioned earlier, privatization in Pakistan has been construed to include disinvestment (with transfer of management and control) and some deregulation.